During this time, real estate brokers often gathered to share information about property listings for sale.
One real estate broker, for instance, would share a property he or she was selling with another broker in hopes of finding a buyer. This "networking" proved highly useful in finding buyers, so the brokers decided to create a system for sharing such information -- and that's how the MLS was born. So, what benefits does MLS offer for homebuyers and sellers?
The most notable benefit of using the MLS is the ability to sell or buy a home in less time. Because it contains listings from multiple real estate brokers -- whom participate in the MLS -- brokers can find buyers and sellers more easily.
For sellers, this means a shorter time on the market. For buyers, this means finding a home in less time. MLS also benefits real estate brokers by giving them access to more properties, which in turn helps them generate commission through sales. The listing broker specifies the commission on the MLS listing, which then becomes available to all other cooperating brokers.
The Bottom Line Whether you're buying or selling a home, you should choose a real estate broker who has access to the MLS. Real estate professionals pay to post homes on the MLS, and each listing is typically only accessible to professionals who have access to that particular MLS. The MLS is intended to help real estate agents and brokers conduct their business more efficiently and effectively. Agents can narrow down the listings in the MLS according to their buyer's preferences, such as square footage, number of bedrooms, neighborhood, and more.
And each listing often contains extensive information and remarks about the property. Specifically, there are two types of listings that are notably absent from the MLS: for sale by owner and pocket listings. In most cases, you need to be a licensed real estate agent or broker to post a home directly to the MLS. So, if a homeowner decides they want to sell their home themselves, the lack of exposure that comes with not being listed on the MLS is one of the key disadvantages.
There are FSBO sites, and homeowners can list their properties on websites such as Zillow, but these don't get the same level of attention from agents and brokers as the MLS does. Another type of listing that you won't find on the MLS is known as a "pocket listing. This is a common practice when famous people sell their homes, for example, but it's not unheard of in more modest home sales as well.
There are some aggregator sites that contain listings from markets around the U. Aside from the obvious difference that these are nationwide listings and not just from a local market, there are some other big differences as well.
Specifically, there is generally much more information in MLS listings. Zillow and Realtor. Think of these as the "CliffsNotes" version of real estate listings, while MLS listings are the entire original book. Some of the information an MLS listing might contain that listings on aggregator sites don't include, but isn't necessarily limited to:.
On the other hand, there is some information that the aggregator websites have that MLS databases don't. We already mentioned that FSBO homes aren't listed on the MLS because access is generally restricted to real estate agents, but these listings can be found on the listing aggregator websites. The most obvious benefit to sellers of listing on the MLS is exposure. While buyers often use aggregator websites like those mentioned earlier when shopping for a home, agents typically look in the MLS.
If you want real estate agents to present your home to their clients as a possibility, you want your home listed in the MLS. Our team of analysts agrees. These 10 real estate plays are the best ways to invest in real estate right now. Find out how you can get started with Real Estate Winners by clicking here.
Advertiser Disclosure We do receive compensation from some affiliate partners whose offers appear here. Develop and improve products. List of Partners vendors. Table of Contents Expand. Table of Contents. What Is an MLS? How the MLS Works. Alternatives to an MLS. By Elizabeth Weintraub. Learn about our editorial policies. Reviewed by Charles Potters. Article Reviewed July 31, Charles is a nationally recognized capital markets specialist and educator with over 30 years of experience developing in-depth training programs for burgeoning financial professionals.
Charles has taught at a number of institutions including Goldman Sachs, Morgan Stanley, Societe Generale, and many more. Learn about our Financial Review Board. MLSs make buying and selling homes more efficient and offer comprehensive information about each home. You can access information on an MLS by working with a real estate agent. An agent can set up automatic emails from an MLS for homes that meet your criteria. Public websites often have the same listings as MLSs, but their information isn't as comprehensive.
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